"The package of measures today involving no retrospectivity, and addressing adequacy and sustainability, I welcome," Mr Crean said.

"They are fair, they are reasonable, but they are also building on the great legacy of making superannuation available to all members of the work force," he said of the measures.

"I am very pleased the announcement today clarified and we can get on with a sensible debate and not speculation."

Mr Crean did a series of media interviews in the past week urging the government not to touch the money people had already put into their superannuation savings and said any reforms needed to be about the long term sustainability of the system, not about finding money to plug the government’s revenue hole.

While he was happy with the reforms -- the headline of which was a tax grab on the earnings of superannuation assets over $100,000 -- Mr Crean said reform of the sector needed to go further.

"I think in the longer term we should be moving from 12 to 15 per cent," he said of compulsory employer contributions.

Share the anguish of columnist Joe Hildebrand, who painstakingly avoided talking about superannuation... until now.

Mr Crean also urged the government to put the measures to parliament as soon as possible.

"The sooner they can go to the parliament they should go to parliament," he said.

"But the real question is can they be passed? I urge the opposition to get behind these measures and for once give bipartisan support."

Super reforms to hit top earners

Superannuation Minister Bill Shorten and Treasurer Wayne Swan this morning revealed Labor would cap the exemption for earnings on superannuation assets supporting income streams at $100,000 with a concessional tax rate of 15 per cent to apply after that.

Tony Abbott immediately hit out at the planned reforms describing them as “another broken promise” that would result in less money in the pockets of Australians.

Assuming an annual rate of return of 5 per cent, the changes - set to take effect from July 1 next year - would affect individuals with around $2 million of savings in superannuation.

"We want to make it better, we want to make it fairer and we want to make it stronger," Mr Swan said of the superannuation system.

The measures - which will also hit politicians - will bring in around $900 million in savings for the federal budget over the forward estimates.

Mr Swan said there was "something wrong" with the system that everyday working Australians weren't getting the best deal from superannuation.

People aged 50 and over will also get a boost to the tax free additional contributions they can make from $25,000 to $35,000.

However the measures may not even go to the parliament before the next election.

“We will do what we can in the time available before the next election," Mr Shorten said.

Abbott slams 'raid on retirement savings'

Tony Abbott today said the new measures were“yet another hit on Australian people”.

The Opposition Leader said people would ultimately have less money as a result of the flagged changes.

“This is a government that is incompetent and untrustworthy,” Mr Abbott said.

“This is a government which is prepared to tax the people to fund own spending.

" On balance this is a $1 billion hit on people's retirement savings. It is a $1 billion hit on savings that belong to the people, not the government."

He said if re-elected there was no guarantee Labor would stop at the measures announced.

“If they get three more years they will go further – it wont stop here,” Mr Abbott said, maintaining there would be no adverse, unexpected changes to superannuation under a first term of a Coalition government.

The Liberal National Party’s candidate in Kevin Rudd’s Brisbane electorate of Griffith, Bill Glasson, today urged the former prime minister to fight against the government’s announced superannuation changes.

"We can’t allow this financially incompetent Labor government to raid retirement savings as a way of trying to cover up their ever-growing budget black hole," Dr Glasson said.

"The danger is - if Labor can get away with this once, they will try it again after the election. We can’t let Labor destroy public confidence in super."

Greens Leader Christine Milne said Labor needed to step up and act on the mining tax after its retreat on superannuation.

"The Government has disconcerted the whole country with their on and off again super reforms. And now they are still failing to say how Australia’s revenue hole will be fixed," Senator Milne said.

"Labor is clearly not serious about facing the revenue challenge Australia confronts. Unless that revenue challenge is addressed we will rush headlong into a less caring Australia where the majority will miss out on the public schooling, health care such as Denticare and the public transport infrastructure they deserve.

"The government should focus on those who can afford to pay: the wealthy mining companies who have short changed Australia of up to $100 billion in revenue."

Keating welcomes balancing reforms

Former prime minister Paul Keating welcomed the changes, saying they had struck the right balance.

Mr Keating said the changes corrected what he called unsustainably generous tax changes under Peter Costello which he said dismantled the former Reasonable Benefit Limit’s structure in favour of an open ended tax free regime.

He added they also had the effect of modestly limiting the otherwise open concessionality on fund earnings while leaving accumulations untouched, moderating the concessionality without returning to the rigidity of the former RBL structure.

"The changes seemed designed to return to the notion of ‘reasonable benefits’ for Superannuation without altering the tax treatment of lump sums themselves," Mr Keating said.

"The former Labor Government’s Superannuation system was designed as a retirement income system broadly to augment the age pension – it was never designed to make possible the shelter of income for those able to contribute increasing levels of precautionary savings and their associated compound earnings.

"The sustainability of the retirement income system demands that that balance be maintained. The Government, by these changes, appears to be striking a reasonable balance.”

Under current arrangements on superannuation, all earnings on assets supporting income streams are tax free in contrast to earnings in the accumulation phase of superannuation which are taxed at 15 per cent.

As part of other changes today Labor will also establish a special Council of Superannuation Custodians to ensure any future changes to the sector are consistent with the agreed Charter of Superannuation Adequacy and Sustainability.

It will work to simplify the design and administration of the higher concessional contributions cap, reform the treatment of concessional contributions in excess of the annual cap, extend normal deeming rules to superannuation account-based income streams, extend concessional tax treatment to deferred lifetime annuities and further reform the arrangements for lost superannuation.

Asked if the changes would help fund the Gonski education reforms and the National Disability Insurance Scheme Mr Swan said it was one of many savings that would help bring back revenue.

"You do create room in the longer term for policy proposals," Mr Swan said.

"There is no magic wand or one area of savings that will instantly change the fact that revenues have come off dramatically."

Speculation over the government’s planned raid on superannuation hit fever pitch this week.

The reforms were due to be part of next month’s federal budget.

Interest groups split on super reforms

The Association of Superannuation Funds of Australia today welcomed the government’s announcement.

The organisation’s CEO Pauline Vamos said it would help stop the panic in the community and allow people to better plan for their retirement in an environment of stability and certainty.

"We have been calling on the government to put a stop to the hysteria and consider policies which take a long-term approach to the future sustainability of Australia's superannuation system,” Ms Vamos said.

She said there was a lot of complexity in the changes which needed to be considered carefully.

“We will examine these proposed changes in detail to ensure they deliver the best outcomes for the sustainability of the system and a comfortable retirement for all Australians."

The Australian Council of Social Service today expressed disappointment over the announced reforms.

"Whilst we obviously welcome these improvements, the reality is the changes announced today by the federal government amount to a mere tinkering at the edges of a system that is grossly skewed in favour of people on the highest incomes," CEO Cassandra Goldie said.

"Capping tax exemptions on superannuation earnings supporting pensions and annuities at $100,000 will only affect people with super assets of more than $2 million. They will still only pay a rate of 15 per cent tax on their super savings, making savings of just $350 million over the next four years.

"This is a drop in the ocean of unfair super tax arrangements that are expected to be valued at $44.8 billion by 2014-15. It is less than half the money the government took away from single parents in the last Budget, who are likely to have little hope of securing adequate retirement savings."

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Comments on this story

Can someone clarify? Is this saying anyone earning 100k+/year will have contributions taxed @ 15%, or are they saying anyone whose super grows >100k/year will have that growth taxed @ 15%? I'd happily take a 100k/year growth in my super if that is the case. Still tastes like crap that politiciams are a protected species on an obscenely disporprtionate untouchable pension (dont call it super) scheme that is denied to everybody else.

Comment 251 of 314

Jonno of Balmain Posted at 10:20 AM April 05, 2013

Sensible and responsible change by Labor (provided the $100,000 is indexed). Compare the Liberals. The Liberals propose to take away super concessions from the low paid - this is unfair but seems to have been missed by most readers... Cheers Jonno

Comment 252 of 314

George of Sydney Posted at 10:20 AM April 05, 2013

As a Lib voter, this is not that dramatic and not as terrible as other gov. ideas ie carbon tax. If your super is generating 100K+ return..a 15% tax is nothing to cry poor about. However there is one thing I would demand, . All public servants including polititians should be FORCED to same super scheme as rest of us and the current insanely generous pension funds must be scrapped. Public servant pension and indexed pensions are tax payer funded JOKE!!!

Comment 253 of 314

mark of Australia Posted at 10:19 AM April 05, 2013

These people have already paid tax on this money, so it's an additional 15%, not just the grab that's being advertised. Why are they being punished for not being a burden on the welfare system?

Comment 254 of 314

The Doc Posted at 10:18 AM April 05, 2013

@ Get Real - fancy having to actually pay tax on your superannuation when you retire. Do you stop using roads and hospitals?

Comment 255 of 314

Jimmy of Sydney Posted at 10:18 AM April 05, 2013

So those that have accumulated wealth all their lives and not collected benefits are now paying the price. Robin Hood tax but what do you expect from a dysfunctional over spending labor govt.

Comment 256 of 314

J.D of Bundaberg Posted at 10:17 AM April 05, 2013

So if you WORK HARD, as in 100K a year hard, when you retire, the government can hand your hard work earnings over to people that DONT. Im not rich by any stretch of the mark, and even I can see how wrong this is. Ayn Rand would be spinning in her grave if she read this.

Comment 257 of 314

Lin of Kingsgrove NSW Posted at 10:17 AM April 05, 2013

I will no longer salary sacrifice to put into my super. Who knows who and what will be next on the Labor government hit list

Comment 258 of 314

Rosemary Palmer Posted at 10:17 AM April 05, 2013

Have none of you actually listened to what Shorten said?
Replay the video. In the pension phase, any INCOME over $100K generated by your capital will be taxed at 15%, and this limit will be CPI indexed. Enough of only publishing scare-monger comments. Sick of the slant, news.com.

Comment 259 of 314

Basic Maths of Brisbane Posted at 10:16 AM April 05, 2013

SendSwan back to school. If the sharemarket continues to recover (probably more than 15%/a) anyone with more than $700k in Super will be paying this tax. This will be a lot more than the 16,000 people he claims will be impacted. There will be many more self funded retirees who have saved for their retirement over many years who will be cought up with this. It amounts to a retrospective tax on superannuation.

Comment 260 of 314

Corporate memory of Victoria pt Posted at 10:16 AM April 05, 2013

The old politics of envy. Tax those who made the sacrifice to save for their retirement.

Comment 261 of 314

sam of Perth Posted at 10:15 AM April 05, 2013

Is there ANYTHING left that this government hasn't taxed...aaarrgggg

Comment 262 of 314

Sean of Brisbane Posted at 10:15 AM April 05, 2013

lol people this is on an oncome stream from your super not many will have an income stream of over 100k besides the rich.

Comment 263 of 314

dexxter of melbourne Posted at 10:15 AM April 05, 2013

Another Labor induced folly on the Australian people to prop up their waste and mismanagement. Super should be left as is. This will not encourage people to invest in their future as Labor could just rip away their savings. Gillard is away and has left the midgets to deliver the news - woefull cowardice.

Comment 264 of 314

MK Posted at 10:15 AM April 05, 2013

I don't see the problem with this. If you have enough in super to be earning 100k/pa from it (ie. you have around 2mil in super) then you DON'T need government subsidies - remember, if that money wasn't in super you'd be paying 45% on it. No more subsidies for the super rich!

Comment 265 of 314

DH Posted at 10:14 AM April 05, 2013

So if you assume 5% earnings per year, you need more than $2mill in your pension to even have to worry about the changes? Of course you could always switch your investments into growth funds and minimise your income earnings... sounds like a whole lot of fuss about nothing!

Comment 266 of 314

Tom Posted at 10:14 AM April 05, 2013

What an absolute joke! Just another example of how the Government takes from those who work hard, to help support those who free load off those who have worked hard to achieve a high income.
I look forward to a coalition government that is made up of business people who have real world experience, and understand the frustrations of those who make the economy what it is!
Great to see that despite the objections of the Industry Super Network, the government thinks they know better and continue with their ad-hock policy making. How about consulting the industry prior to making a policy change!? Nothing unusual with this government, seems to be the Norm!

Comment 267 of 314

Jack of Sydney Posted at 10:13 AM April 05, 2013

They need the money to fund for the costly asylum seekers bill costing $2billion a year.
We shall see massive flowing of funds to HK, Singapore and Switzerland. Why put money in Australia and get taxed?

Comment 268 of 314

Camm Posted at 10:13 AM April 05, 2013

At the above - are you all morons? Does anyone here earn over 1.1 Million? If not - there is no effect to you. What this is doing is redistributing wealth that the super rich would direct into their super both tax free, and with other concessions. Morons might want to read the policy before they comment like sheep.

Comment 269 of 314

Debbie of Australia Posted at 10:12 AM April 05, 2013

Bastards

Comment 270 of 314

Andrew Posted at 10:11 AM April 05, 2013

So, I pay taxes all my life, become a self funded retiree and then get taxed some more. What a joke. the worst part is that I'm not 'rich' or 'wealthy' just made good decisions on my super

Comment 271 of 314

Get Real Posted at 10:11 AM April 05, 2013

Andy @ 9.43am - The big deal is that if they start now where will it stop? Do you seriously think that if they start taxing this now that it will stay at 100k? I'm pretty sure they will continue to reduce the value and eventually all super will be taxed. This like their Media reforms is looking to set a very dangerous precedent.

Comment 272 of 314

Add another one of To their stuff ups Posted at 10:10 AM April 05, 2013

I thought the whole idea of super was so that one can retire comfortably without having to fall back on benifits from the government, if their plan is to have everyone retire on an even playing field then the taxpayer of the future is going to be well and truly screwed.

Comment 273 of 314

Robbo Posted at 10:10 AM April 05, 2013

Sooooo many people here who can't read or count. I'm thinking they don't ever need to worry about their annual Super EARNINGS being over ONE HUNDRED THOUSAND DOLLARS A YEAR!

Comment 274 of 314

Deborah of Melbourne Posted at 10:10 AM April 05, 2013

From what I gather the pollies entitled to an enormous amout of Super irrespective of whether they "stuff up" whilst employed by the Australian Taxpayers make these ridiculous rules. They should start to live in the real world like us "worker bees". I read this week that when they die their Super is then paid to their spouses (part payment) . What was that speech Joe Hockey gave about "The Age of Entitlement". The whole of the government, beaurecrats and the fat cats should practice what they preach. Maybe then we "mere mortals" may have some respect for them. And there are plenty immoral things in Australia, like the 6000 people who sleep homeless each night in Melbourne, the fact that we ignore the way our elderly and infirm are treated, that we place injured and sick young people in nursing homes when they should have some quality of life. When will someone in government have the ability to see past their own ego and salary and stop wasting our money.

Comment 275 of 314

barry of sydney Posted at 10:10 AM April 05, 2013

further political suicide---super is not worth a crumpet---make the government pay pensions---thats what they will end up having to do if they take away your nest egg

Comment 276 of 314

Tom Wilton of Revesby Posted at 10:10 AM April 05, 2013

This impacts on 16,000 Australians only, wealthy people who should pay more. If you earn $100,000 a year in super profits you have to have two million in your account to do this, therefore you're wealthy. Gee guys I know you won't print this so why do I bother. You only print anti government propaganda. Abbott's plan is to tax the super of low income earners. Which is fairer?

Comment 277 of 314

Iggy Crash Posted at 10:08 AM April 05, 2013

Unless your super EARNS over 100,000 a year, you won't be subject to the new tax. About 20,000 people country wide will be effected. Seriously, why shouldn't high earners be taxed more?

Comment 278 of 314

Boris Posted at 10:08 AM April 05, 2013

Gives me more incentive to not put away any super and just live off the government when you are over 65

Comment 279 of 314

Paul of Melbourne Posted at 10:07 AM April 05, 2013

Fantastic!! We will now have a Council of Superannuation Custodians - a new Canberra bureaucracy. What is that going to cost us

Comment 280 of 314

Al of Sydney Posted at 10:05 AM April 05, 2013

Please clarrify:
Are they looking at taxing contributions of over $100k per annumn, interest/earnings within the fund of over $100k per annumn (interest etc) or payments when super is paid out of over $100k per annumn?

Comment 281 of 314

Mick of Melb Posted at 10:04 AM April 05, 2013

Another nail in this useless governments coffin. One can only hope these mob lose heaps from their But I'm betting they will be exempt.

Comment 282 of 314

Gary T Posted at 10:04 AM April 05, 2013

Who are you to decide how much I retire on, Mr. Swan????? You need to realize that the EU and the government of Cyprus haven't got away with stealing from the people yet. Carry on with your program of creeping slavery and you will find yourselves on the receiving end of the full wrath of the people

Comment 283 of 314

Roary Posted at 10:03 AM April 05, 2013

I'd like to see the tax paying records of some of the extremists commenting on this logical change.

Comment 284 of 314

Emily Posted at 10:03 AM April 05, 2013

Will Mr Goose pension of $160K plus be taxed?

Comment 285 of 314

Macy Posted at 10:03 AM April 05, 2013

So... They want to take superannuation above politics.... So they begin by bagging the opposition leader.

Comment 286 of 314

K of GC Posted at 10:02 AM April 05, 2013

Wow. This government has really lost the plot. I have always supported them, but not any more. Do they really think that ANYONE can live comfortably with super of only $100,000? Unfortuantely that kind of money would only last the average person 2-3 years max. I won't be making any extra contributions to my super because when i retire they may have raided the whole lot. I'll put my money elsewhere thanks.

Comment 287 of 314

Guest Posted at 10:02 AM April 05, 2013

Who do they take from when there is nothing left to take from the wealthy?

Comment 288 of 314

RamRod Posted at 10:01 AM April 05, 2013

Once again we see the target squarely painted on the back of those who work their arse off to get ahead, while rewarding those who couldn't be bothered to work, educate themselves or apply some effort. What is the point of promoting education in this country if it is so equitable to do nothing, get governement hand outs and enjoy your free time. When is the government (any of the parties) going to start rewarding the hard work we do rather than penalising the benefits we get from it. I often ask myself what the point is of working over 10hrs a day when I could live at Byron Bay on the dole and surf every day.

Comment 289 of 314

pbarty of nth qld Posted at 10:01 AM April 05, 2013

bye bye

Comment 290 of 314

Stu Posted at 10:00 AM April 05, 2013

Are we actually going to have any of our pay left after the constant mess these governments put us through that we have to pay for.

Comment 291 of 314

Brad of Australia Posted at 9:59 AM April 05, 2013

You wouldn't mind if Swan spent the money wisely .. But its just wasted on badly installed pink batts, and over priced school halls, over priced digital set top boxes. To be honest I'm to wild to continue typing .. I could be here till September 14.

Comment 292 of 314

Ferret of Sydney Posted at 9:57 AM April 05, 2013

So after all this Labour really is launching class warfare? And lets see, we have a projected $20 billion gap in our budget per year and this measure will provide $900 million over the forward projections (isn't that 5 years?). So how about the rest of the gap? Oh right, we will leave that to Liberals to work out

Comment 293 of 314

Gary T Posted at 9:56 AM April 05, 2013

I'm a bit lost here. Are they saying that anyone with more than $100 000 in their super fund is going to be taxed on anything above tat amount, or are they saying that they will tax any profit above $100k?

Comment 294 of 314

Jez Posted at 9:56 AM April 05, 2013

This government is one big joke!!! Bring on the election!!

Comment 295 of 314

Stuart of vic Posted at 9:55 AM April 05, 2013

Shorten your choice of words is unbelievable. How dare you assume what each retiree requires to be comfortable. How dare you again pick on those that choose to work hard and pay more than ample tax. Resign now as you have absolutely no vision nor knowledge of your job.

Comment 296 of 314

Ross of Sydney Posted at 9:54 AM April 05, 2013

Well it sounds a little like we now live in Austracyprus.
Our pathetically incompetent, money wasting Gillard Labor government now wants to raid the savings of those who have studied hard, worked hard and saved hard, to bail out their budget after wasting heaps and handed out heaps to buy votes.

Comment 297 of 314

get out swan Posted at 9:50 AM April 05, 2013

there liars and are not to be trusted.
they will get money from where ever they can,
to patch up there budget figures all at our expense!

Comment 298 of 314

Tony Posted at 9:48 AM April 05, 2013

This won't affect most people with SMSF as they will just go to their friendly accountant and use the mechanisms in the tax system to avoid paying anything more than $100k in income while living like Tinkler on $9900 a year. The whole tax system is a joke and not progessive at all for the wealthy

Comment 299 of 314

Michael Conaghan of Brisbane Posted at 9:48 AM April 05, 2013

This proposal may sound all well and good to the Politicians but does the new proposed regulations apply to their over generous pensions?

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